China’s cheap exports are ‘a fact of life,’ Siam Cement Group’s CEO says—so Southeast Asia’s factories need to get bigger
The Thai industrial giant says regional scale, not national scale, is the only way to keep unit costs low enough to compete.
Siam Cement Group CEO Thammasak Sethaudom contends that China's surplus production of industrial goods is an unavoidable reality, which Southeast Asian manufacturers must confront. Speaking at a summit in Ho Chi Minh City, Sethaudom noted that the influx of low-cost Chinese exports has saturated regional markets, making it difficult for local firms to thrive.
To compete, he emphasized the need for Southeast Asian companies to scale up their operations, building larger plants capable of supplying the entire ASEAN region rather than just a single country. The CEO also highlighted a recent $5.5 billion merger between SCG Chemicals and PTT Global Chemical, showcasing the conglomerate's commitment to expanding its footprint.
Sethaudom dismissed the notion that automation is merely a cost-cutting strategy, arguing that the precision of robotic systems offers superior quality in industrial production. Meanwhile, industry observers expressed optimism about Southeast Asia's potential to elevate its economic standing by shifting towards higher-value sectors powered by technological advancements like artificial intelligence.
They pointed to Vietnam's growing role in fiber-optic cable manufacturing and SAP's investment in Southeast Asian R&D hubs as promising developments.
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